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19-02-2011, 03:05 PM
FUNCTIONAL STRATEGIES PRAVEEN.ppt (Size: 889.5 KB / Downloads: 128)
Functional strategy is the approach a functional area takes to achieve corporate and business unit objectives and strategies by maximizing resource productivity
It is concerned with developing a distinctive competence to provide a company or business unit with a competitive advantage.
A multi-dimensional company has several business units.
Each unit has its own business strategy
Each unit has it own set of depts.
The orientation of functional strategy is dictated by its Parent business unit’s strategy.
A mfg functional strategy that emphasizes on an ‘expensive,quality assurance’ process over ‘cheaper,high volume’ production.
A H.R functional strategy which stresses on hiring and training high skilled but costly workforce.
To achieve corporate and business unit objectives and strategies by maximizing resource productivity.
To develop a distinctive competence to provide the company with competitive advantage.
FUNCTIONAL STRATEGY OBJECTIVES
TYPES OF FUNCTIONAL STRATEGIES
Information Management Strategy
Deals with pricing,distributing and selling a product.
Here the company uses two types of strategies namely
1.Market development: where the company or its unit captures a larger market share of an existing market.
Eg: Unilever, Colgate-Palmolive
Firstly these companies are experts in advertising and promotion to implement strategies
Secondly they extend PLC by introducing “new and improved” variations of the product.
2. Product development:
They develop new products for existing markets
They develop new products for new markets
Eg: Gujarat Co-operative milk marketing federation developed new products to sell to its existing customers,then through Amul it introduced Ice-creams and Desserts,Health drinks etc.
[Can be called as Line extension]
OTHER MARKETING STRATEGIES
1. Should the company sell directly to mass merchandisers?
2. Should the company use distributors and dealers to sell its products?
Eg: John Deree [sells tractors and lawn movers] opted for both mass merchandisers and dealers.